USA/UK: Biden administration lifts ban on Scottish Whisky

As part of a truce with the UK, the new US Biden administration suspended punitive duties on single malt whisky imports in a 17-year-old trade dispute over illegal subsidies for plane makers Boeing and Airbus.

“The United Kingdom and the United States are undertaking a four-month tariff suspension to ease the burden on industry and take a bold, joint step towards resolving the longest running disputes at the World Trade Organization,” the two governments said in a joint statement. “This will allow time to focus on negotiating a balanced settlement to the disputes, and begin seriously addressing the challenges posed by new entrants to the civil aviation market from non-market economies, such as China,” the statement goes on.

As a former EU member, member of the European Airbus consortium and producer of wings and other Airbus parts, the UK is part of this dispute that has seen the EU and the US target billions of dollars worth of each other's exports with taxes.

After the US-Trump administration imposed in March 2018 unilaterally a tariff on EU steel and aluminum (, 24.4.2018) the European Union did likewise in June 2018 with a tariff USD 3 billion worth of US goods, including whiskey, motorcycles and denim. As a tit-for-tat response the US. followed with a 25% tariff on Scotch whiskies last October.

As a consequence, exports of Tennessee whiskey and Scotch Whisky both declined significantly and left losers on both sides. (, 29.6.2020)

Scotch whisky producers were particularly hard hit as the United States are a key export market. Distilleries have reported GBP 500 million (USD 692m) of losses since 2019 due to the tariffs.

"The tariff on single malt Scotch whisky exports to the US has been doing real damage to Scotch whisky in the 16 months it has been in place, with exports to the US falling by 35%," Karen Betts, head of the Scotch Whisky Association, said.

Since definitively leaving the EU at the end of last year, the UK has tried to defuse the issue and suspended on 1 January retaliatory tariffs on some US goods. The US followed now suit and lifted likewise tariffs on Whiskey, UK cheese, cashmere and machinery.

"From Scotch whisky distillers to Stilton-makers, the US decision to suspend tariffs on some UK exports today will benefit businesses right across the UK," UK’s Prime Minister Boris Johnson tweeted today.

This is a significant step forward in an attempt of the UK administration to secure post-Brexit trade deals. However, it does not seem that the new US-Biden administration is prioritizing the UK ahead of the European Union and an UK-US free trade deal is not in sight.

While US tariffs continue to apply to EU goods, Katherine Tai, US President Biden's top trade nominee said she will make it a priority to resolve the row with the EU and Britain.

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